PTTE 434 - Lecture 2 Quality Assurance, Organization & Management Gryna: Chapters 8, 9, & 12

1. PTTE 434 - Lecture 2Quality Assurance,Organization & Management Gryna: Chapters 8, 9, & 12 Organization for Quality Developing a Quality Culture and Understanding Customer Needs

2. Lecture 2 - Objectives • Understand the concepts of the organization for quality • Discuss the evolution of quality and new approaches for coordinating and organizing quality activities. • Discuss concepts for developing a quality culture. • Discuss the importance of understanding customer needs.

3. CH 8 - Evolution of Quality - 5 Major Trends in the 1990s • Transfer of Quality Management tasks to line organizations. • Scope broadened from operations (little Q) to all activities. • Expansion of quality teams • Delegation of decision making authority to lower levels • Key suppliers and customers involved in “parterning” and “virtual corporations.”

4. New Approaches for Coordinating and Organizing Quality Activities • Flatter organizations • Increases in cross-functional teams • Decrease in size and increase in output (leaner organizations) • Group rewards • Lower-level employee participation • Changing organizational boundaries

5. Coordination of Quality Activities • Coordination for control achieved by regular line and staff departments • Formal procedures • Feedback loops employed • Forms • Audits • Sampling • Control Charts • Reports • Creating change is coordinated through project teams and other organizational change agents.

6. Parallel Change Organizations • Exist because quality department focuses mainly on coordination for control. • These may be permanent or ad hoc • May be mandatory or voluntary • Examples are process teams, quality councils, quality project teams, integrated product teams, pip teams etc. system.

7. Creating Change • Creating change is coordinated through project teams and other organizational change agents. • Three levels of control: • Organization level: Broad view • Process Level: Cross-functional • Individual Level: Specific activities

8. Role of Upper Management • Upper management must “walk the talk” if they expect the organization to follow their leadership and desire for quality improvement (active leadership). • Upper management should provide the necessary resources • Upper management’s main role is to break roadblocks and pave the way toward achieving continuous quality improvement.

9. Importance of Management Leadership • In order for management to “inspire” a commitment to quality, management must “walk the talk.” • Management must spend time improving quality. • Management must commit resources and people to quality improvement.

10. Provide evidence of management leadership • Management must spend time on quality issues and programs • Hard to convince management of the need - 10% of their time is difficult to justify • When upper management spends the time, it provides evidence of leadership - “Walking the talk!”

11. Things Upper Management can do to “walk the talk” • Establish and serve on a quality council • Establish quality strategies • Establish, align, and deploy quality goals • Provide training • Serve on an upper-management quality improvement team • Review progress and stimulate improvement • Provide for reward and recognition

12. Quality Council (Leadership Team) • Comprised of upper management • May be at several levels • Corporate • Division • Business Unit • Role is to develop the quality strategy and facilitate its implementation. • Individual council members can “champion” key quality related projects.

13. Quality Council Charter • Formulate quality strategies and policies • Estimate major dimensions of the quality issue • Establish infrastructure • Select quality projects • Assign project team leaders and members • Provide resources including support for the teams

14. Quality Council Charter (Cont’d) • Plan for training for all levels • Establish strategic measures of progress • Review progress and remove roadblocks • Provide for public recognition of teams • Revise the reward system to reflect progress in quality improvement

15. Role of the Quality Director • Administer the quality department • Assist upper management with strategic quality management (SQM) • Administer both technical and strategic quality activities. • Large organizations may have both quality engineering and quality management organizations e.g., INEEL.

16. Kelly Services Quality Council Charter est.1995 (example) • Identified key responsibilities as: • Set and deploy vision, mission, shared values, quality policy, and quality goals • Review progress against goals • Integrate quality goals into business plans and performance management plans • Bottom line - “Providing evidence of upper-management leadership is clearly important in establishing a positive quality culture.” i.e. “walk-the-talk”

17. The Quality Department of the Future • Plan Quality (Company wide) • Set-up quality measurement (at all levels) • Audit (Outgoing) Quality • Conduct quality projects • Assist quality projects • Participate in supplier partnerships • Establish training • Consulting for quality • Develop new quality methodologies • Transfer activities to line departments

18. Role of the Workforce • Nominate quality problems for solution. • Serving as members on quality teams. • Identify elements of own jobs that don’t meet self-control criteria. • Become knowledgeable of the needs of their internal and external customers.

19. Role of Middle Management • Nominating quality problems for solutions. • Serving as leaders of various types of quality teams. • Serving as members of quality teams. • Serving on task forces to assist the quality council develop elements of the quality strategy. • Lead quality activities within their own area through personal commitment and employee encouragement. • Identify customers and suppliers • Meet with customers and suppliers to identify and address their needs

20. Role of Teams - General • “Organization of the future” concept • Two systems (Sociotechnical systems, STS): • technical (equipment, procedures, etc.) • social (people, roles, responsibilities, etc.) • Benefits include significant cost savings, improved customer satisfaction, reduced cost, increased revenues, better communication between employees and management. • Three types of teams: quality project teams, workforce teams, and self-managing teams.

21. Types of Quality Teams

22. Team Member Responsibilities • Project Champion - Upper management member who provides leadership, support, and mentoring. He/she follows progress and removes roadblocks. • Project team leader - Steers team, provides knowledge of the project area, teambuilding skills. Usually comes from the organization most affected by the problem. • Project recorder - Handles documentation, agendas, minutes, reports, etc. • Project team members - Cross-functional, may include consultants, must have sanctions from organization manager to be relieved from usual duties while on the team.

23. CH 9 - Developing a Quality Culture • To become superior in quality a company must develop technologies that meet customer needs, and develop a culture committed to quality. • A positive quality culture must flow from top down. • Management must recognize people’s needs and know how to meet them.

24. Management Philosophies • Mazlow - Hierarchy of needs. • McGregor - Theory X, Theory Y • Hertzberg - Satisfiers and Dissatisfiers

25. Mazlow’s Hierarchy of Needs For more information, click on the picture.

26. Abraham Mazlow’s hierarchy of needs

27. Frederick Hertzberg: Satisfiers and Dissatisfiers • Dissatisfiers (hygiene factors): • Depend on what the company does. • Can be changed. • Example - low pay, won’t attract the best people. • Once improved hygiene conditions are accepted as normal, they don’t modivate behavior.

28. Hertzberg: Satisfiers and Dissatisfiers • Satisfiers (motivators): Satisfaction comes doing the work, depends on your point of view. • Assembly worker: Happy to leave at end of the day to go home and do something more appealing. • Researcher: May work overtime because his work is more interesting than an outside hobby, or other pastime.

29. Douglas McGregor:Theory X and Theory Y • Theory X (Autocratic): Negative view of workers. • lazy, uncooperative, etc. • Managers combat decline in motivation through incentives and penalties. • Gives some workers security • Theory Y (Participative): Improve work conditions and the workers will improve. • Improves human relations • Permits normal human drives to assert themselves.

30. Theory X Assumptions • People dislike work, so they must be controlled and threatened before they work hard enough. • The average person prefers to be directed, dislikes responsibility, is unambiguous, and desires security above everything. • These assumptions result in both “tough” management with tight controls, and “soft” management which aims at harmony. • Both are wrong because man needs more than financial rewards - the opportunity to fulfill himself. • Theory X managers don’t provide this opportunity.

31. Theory Y Assumptions • Physical and mental effort is as natural as play or rest. • Control and punishment are not the only ways to make people work. • A satisfying job will result in commitment to the organization. • The average person learns not only to accept, but to seek responsibility. • A large number of workers use imagination, creativity, and ingenuity to solve work problems. • The intellectual potentialities of the average worker are only partially utilized. (See: http://www.accel-team.com/human_relations/hrels_03_mcgregor.html)

32. Corporate Culture • Corporate Culture: Habits, beliefs, values, and behavior. • Management defines and creates the necessary culture for success. • Quality culture is an integral part of corporate culture.

33. Eight primary values that promote employee loyalty • Purpose: Vision stated in terms of product or service and benefit to the customer. • Consensus: 3 decision making styles - command, consultative, and consensus - should be matched to particular circumstances. • Excellence: Management creates an environment in which pursuit of knowledge for improvement is pervasive. • Unity: The emphasis here is on employee participation and ownership of work.

34. Eight primary values that promote employee loyalty • Performance: Focus on individual and team rewards along with performance measures. • Empiricism: Management by fact and use of the scientific method. • Intimacy: Sharing ideas, feelings, and needs in an open and trusting manner without fear of punishment. • Integrity: Managers act as role models for ethical practices.

35. Actions necessary for change • 7 dimensions of culture: • risk orientation • relationships (people) • information • motivation • leadership • organizational structure • organizational focus • Define, determine current state, define desired state, develop an action plan to close the gap, measure progress

36. Denial/resistance Performance • High performance team • Dynamic environment • Extraordinary trust and communication • Resistance to change • “No problem” attitude $, Results, morale, or productivity • Improved teamwork • and productivity. • Higher trust • “Breakthrough” successes • Building optimism • Lack of trust pervasive • Fear of change • Active and passive • resistance to change • Organizational incompetence Acceptance Emotional Time Organizational Change Curve

37. Quality Culture (Values) • Negative - “hide the scrap” • Positive - “Climb the ladder to delight the customer.

38. OLD Permission to be right Rote Orderly Unimaginative Quiet Obedient Trained Be hidden Somber A commodity Don’t make waves Paid by position Don’t rock the boat Stable Values - Employee’s Role NEW Permission to be wrong Conceptual Productive Creative Communicative Assertive Educated Posting of performance Wit, humor A vital problem solver Experiment Paid by skills Never be satisfied Innovative

39. Values -Manager’s Role OLD Hold power Authority figure Go on hunch Avoid blame Quota set by manager An obstacle to change Holder of knowledge Do Status quo Central control Demand compliance Boss knows best Territory is everything Restrict NEW Give power Role model Get hard data No excuses, no blame Common goal - customer Remove obstacles Teacher Delegate - follow up Experimental Decentralize wherever possible Teach participation Boss listens best Territory is irrelevant Cross train, enhance

40. Values - Customers OLD Prescribed product Treat like an account Outsider Win - who cares Reactive contact Special requests - ROI Current sale Remote In the dark On their own Ridiculed Tolerated NEW Accommodate needs Treat like a person partner Win-win Proactive contact Ok, if it doesn’t hurt other cust. Lifetime value Engaged Informed Supported Respected Enjoyed

41. Values - Production Process OLD Standardize Focus - keep busy Manager does stats Automate anything Rule by seat of pants Price first Quality inspectors Quality costs Buy new equipment Productivity thru technology Rigid Push Ignore setup time Accept cycle time NEW Customize Focus - value added Stats controlled by line Automate non-value added Measure what you want to occur Quality first Build in quality Quality is free Improve equipment first Productivity thru process Flexible Pull Minimize setup time Reduce cycle time

42. Communicating Quality • Different languages at different levels: • Upper Management: Language of money • Middle Management: Bilingual • Lower Management and Supervisors: language of products. • Employees understand “job security” best.

43. 3 Elements of Self-Control • Knowledge of what is supposed to be done. • Feedback on how we are doing • Means of regulating a capable process.

44. 5 Key Drivers for Developing a Quality Culture • Provide quality goals and measures at all levels. • Provide evidence of management leadership • Provide for self-development and empowerment • Provide participation as a means of inspiring action. • Provide recognition and rewards

45. Culture can be changed - Feedback mechanisms • Define the desired factors to measure - measurements are the vital signs of progress • Units of measure must be carefully defined to inspire a positive priority for quality - e.g., count only good output. • Use reports and scoreboards of quality measures and output • Remember that steps that are “obvious” to management may not be obvious to employees. • Maintain awareness through highly “employee” visible means - quality newsletter, announcements, etc.

46. Quality planning, quality control, and quality improvement Strategic quality management Goals Recognition; Awards Leadership Individual and team quality activities Organization Self- development Participation Departmental quality activities Technology and Culture

47. Organizational Goals Process Goals Functional Goals Job Goals Quality Goals and Measurements at All Levels

48. Setting direction Vision mission and priorities RX 3- to 5-year goals and strategies RX annual objectives and vital few actions Deployment Cascade objectives and agree on vital few actions Management Execute and implement Regular reviews Annual review/diagnosis Quality policy deployment Plan the work Do the work Check the work Act - action and countermeasures “Catchball” Participative step at each level to ensure capability and commitment

49. CH 12 - Understanding customer needs - • Quality and competitive advantage - All departments have a role in the quality effort • Identify the customers - External, internal, suppliers, some obvious, others not so obvious. • Strive to “delight the customer.” • Understand customer needs.

50. RUMBA - Verifying Requirements • Reasonable: Can you meet the requirements? • Understandable: Do you understand the requirements? Verify with the customer. • Measurable: Can it be determined if, and when you have met the requirement? • Believable: Do you and your employees agree with the requirement and that it can be met? • Achievable: Can the process meet the requirement? Is it realistic? If not, renegotiate with the customer.